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Drafting a business plan is an excellent way to map out the specific details about the business. Depending on the type of the business involved, a business plan can vary in size from a few pages to several hundreds of pages with sub-divisions such as business description, operations, management, market strategies as well as competition analysis. While no two plans can be alike, there are certain elements and strategies that every effective plan must contain. For the purpose of this discussion, this article discusses in detail the major parts of an effective business plan.

Elements of a good business plan

1. Business analysis

This part describes the analysis of the business environment, business opportunity, marketplace, industry, customers as well as competition and how to catch-up with other competitors.

2. Business Description

This part describes the abilities and capabilities that put the business to stand out from other competitors, including the company technology, management, operations, finances, services and even distribution.
It should also highlight the organizational structure of the business, including the title and job descriptions of directors, officers and other members of staff. This element is an important management tool that can be referred to regularly to make sure the company is on course with meeting business targets and goals.

3. Financial Overview

It states financial issues like state and sources of finance, budget, balance sheet, income statement, profit projection and cash flow statement.
By giving detailed figures and statistics in a business plan, the company stands a higher chance of securing loans and even attracting new investors.

4. Company Overview

It provides an analysis of the company’s vision, values, mission, products, business opportunity and other unique qualities.

5. Action plan

Explains the steps and measures to implement the business plan to achieve the goals and objectives of the firm.

6. Company strategic plan

It provides the business roadmap to the future by highlighting issues such as how the company intends to seize opportunities, how to increase profit and even how to exit the business if it fails to meet its goals and objectives
At the end of the day, it is important to note that a good business plan should spell out who a business is, what it does, how it runs and even where it is going. Keeping these important tips makes it easier to develop a killer business plan. Therefore, learning the components of a good business plan is important for all business-minded people.…